M&S, Three, Volvo: 5 things that mattered this week and why

From M&S’s transformation strategy reaching an “inflection point” to Three’s move to shake off its challenger perception in the UK and Volvo’s DTC play, catch up on this week’s biggest marketing news.

M&S

Has M&S reached an ‘inflection point’ in its transformation strategy?

As M&S shared its full year results this week, chairman Archie Norman called out a “cynical” observation that he had seen made about the business – that it is stuck in a cycle of “never ending transformation”.

“I think a bit of that is true,” he said during an investor webcast. “Businesses today constantly have to go through a process of self-disruption that doesn’t end, and in M&S, even more so.”

However, he and CEO Steve Rowe are confident this time, under its ‘Never the Same Again’ strategy, M&S has finally reached an “inflection point”. For the first time in three and a half years, there has been enough progress to believe the retailer is on the verge of becoming a growing business again, Norman claimed.

That level of confidence doesn’t seem immediately justified in M&S’s results for the year ending 28 February. The business recorded a group statutory loss of £201.2m, as group revenue fell -11.9% to £9bn.

However, there are green shoots emerging. M&S’s relaunched loyalty scheme, Sparks, has performed well, its value perception has improved, and the retailer has taken a leap into offering third-party brands through its clothing business for the first time.

But most importantly, its new partnership with online supermarket Ocado is delivering “exceptional” early results, recording revenue growth of 43.7% and contributing £78.4m in net income towards M&S.

Whether that really will be enough to turn M&S around remains to be seen, but at the very least, the retailer can’t be faulted for its speed of transformation during a universally difficult year. MJ

READ MORE: M&S hails early success of Ocado tie-up despite major group loss

Why Three is confident in the 5G era

Three is brimming with confidence that with 5G it can mount a more competitive challenge against rivals O2, Vodafone and BT/EE.

The mobile operator has armed itself with the technology to provide what every customer wants – a solid connection and rapid download speeds.

The brand is currently sitting on the most amount of 5G radio waves out of the UK’s four mobile network operators (MNO), more than triple the amount O2 and BT/EE have.

Three UK and Ireland marketing director Aislinn O’Connor said marketing has a vital role in not only growing the brand but also boosting the business – she believes that’s the duty of every marketer.

O’Connor has a bit of a job on her hands as Three has an overall BrandIndex score of 3.7 putting it in 16th. This puts it behind its three main rivals and even smaller MVNO (mobile virtual network operator) brands such as Tesco Mobile, Giffgaff and Sky Mobile.

Three believes it has the plan to appeal to 40 million mobile customers across the UK and make it one of the dominant players, mirroring its presence in Ireland.

The brand has embarked on more mainstream appeal campaigns with its shirt sponsorship of Chelsea FC being central to its ‘Real 5G’ campaign, with more on the cards coming later this year. MP

READ MORE: How Three’s top marketer plans to shake off its challenger image in the UK

Look past the ‘false boundaries’ of brand and performance

Performance or brand? Short term or long term? Digital or traditional? Separate marketing teams or just the one? It’s all a bit complicated, but according to effectiveness expert Tom Roach, vice-president of brand planning at digital marketing agency Jellyfish, it doesn’t need to be.

Instead, Roach has urged marketers to look past these “false boundaries”, at least from a campaign perspective, and to bring brand and performance together as one.

“All longer-term success comes through the short term, so the more we can get together and work together, the better,” he said during a Marketing Society webinar this week.

The practicality of taking on this mindset shift could mean major internal changes for marketers. Some brands, like online florist Bloom & Wild, have separate marketing directors for brand and acquisition – would this continue to make sense? Would KPIs have to change? Would existing campaigns have to be overhauled?

It’s an interesting discussion, and one that we’re seeing debated across many brands and media businesses right now.

For Discovery, bringing brand and performance together during the launch of streaming service Discovery+ late last year was of huge importance and, according to vice-president of growth marketing, Adriana Rizzo, played a big part in its overwhelming success.

To ensure that both brand and performance were thought about holistically and equally, Rizzo’s team broke down siloes by involving the entire Discovery+ marketing team in reviewing KPIs across both goals in a collective weekly meeting.

“You end up with a team that doesn’t have this siloed view that thinks, I’m getting rewarded for performance so that’s all I care about. Because there’s this understanding that the two of them help each other,” she said. MJ

READ MORE: Marketers urged to ignore ‘false boundaries’ of brand and performance

Volvo looks to DTC and subscriptions to avoid car industry pile-up

Volvo electric carVolvo has taken evasive action to avoid the sales slump hitting the automotive sector by using a direct-to-consumer channel to boost sales, and a new subscription strategy that appeals to a younger and more urban consumer. In a category where sales are down by 12.9%, Volvo’s UK sales are up by 15%.

Volvo UK consumer director Nicole Melillo Shaw was brought in from outside the car industry to drive a focus on consumers and service. She says the company identified a clear demand for a digital connection with the brand before Covid-19 added a sense of urgency.

“Just before lockdown we had initiatives in place. We had a restructure planned around making ourselves better set up for a direct-to-consumer approach,” says Melillo Shaw. “What we did was really just accelerate a lot of those areas.”

More than nine out of 10 drivers who have adopted the Care by Volvo subscription service are new customers, she says. The brand is currently engaged in a fundamental rethink of how its retail network operates to better reflect the way modern consumers buy cars, resulting in ‘less transactional’ showrooms that focus on service and after-sales care.

READ MORE: How Volvo attracted ‘conquest consumers’ with its DTC play

William Hill chases global recognition with major marketing push

Becoming a global brand is the ambition at William Hill, which has been steadily growing its international footprint online amid a year of lockdown.

In the UK, the bookie wants to dial up the digital side of its brand and get consumers to think beyond its high street betting shops, 119 of which did not reopen after lockdown. Internationally the idea is to “drive familiarity”, with a particular focus on Spain, Sweden and Austria, markets where the gambling brand already has a strong following.

To do this, William Hill has ramped up its marketing investment with a global campaign, updated master brand and refreshed identity. The campaign is building on the ‘It’s who you play with’ platform launched in 2019 to celebrate the social side of gambling and features a mix of horse racing, darts and football.

The bookie is also unveiling a new look and feel, designed to present the “modern, dynamic and emotive face” of William Hill. The yellow logo has been given a gold makeover, reflecting what the brand describes as its “gold standard status” with customers.

For the media strategy, the focus is on being “public, everywhere and confident”, combining TV and video-on-demand with social media, digital, outdoor and a big investment in radio. The investment in audio comes as William Hill hopes the campaign soundtrack – Neil Diamond’s Sweet Caroline – will act as a sonic identifier for the brand, rooted in sports culture.

Highlighting the social side of gambling has been core to the brand’s strategy over the past two years and fits the notion of excited fans emerging from lockdown with a summer of sport ahead of them.

In a wider sense, chief brand officer Charlotte Emery, who joined William Hill in 2018 from British American Tobacco, is on a mission to “elevate” the gambling category. This latest campaign represents a shift away from the “shouty” style ads that have characterised the sector for years, crucially an ambition William Hill also shares with its competitors. CR

READ MORE: William Hill dials up marketing spend to chase ‘global brand’ status

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